Trade Closed: 2011-01-24 2:16
I won… but not as big as I could’ve! I admit it… I closed early because I thought the pair was ranging. It’s not like I got scared or anything though. I liquidated my position because the pair consolidated a few hours after my second position had triggered.
Closed both positions at 1.3459
Total Gain: +0.57%
While the thought of missing a huge move like that is annoying, I am pretty happy. It’s always nice to start the year with a win!
Trade Idea: 2011-1-20 02:52
For the past two weeks, EUR/USD has been rallying. It seems that investors are becoming more and more optimistic, and are ready to give euro zone a chance. This tells me that the market could be in the middle of a sentiment change, from euro bearish to bullish.
We’re also seeing some really interesting things happening in the U.S. stock market and the commodities market. Apparently, the S&P 500 managed to trade at its highest level since September 2008, thanks to improved risk appetite. Crude oil has also showing been some strength, as it continues to trade above $90/barrel.
Looking at the charts, we can see that the pair has been making “higher lows” in the past few days while the Stochastic has been making “lower lows.” As you cool cats who have gone through the BabyPips.com School of Pipsology know, what we’re seeing is a hidden bullish divergence which is usually taken as a sign that the trend will continue.
Giddy as I was when I saw this earlier, I kept my cool and waited for more confirmation. I just had enough time to put on my makeup when I got the go signal I was waiting for: an inverted hammer at the 38.2% Fibonacci retracement level.
I entered at market at 1.3443, risking half of my usual 1.0% position. The other half I saved for another buy at 1.3400, near the 50% Fib, in case price falls further. I placed my stop for both positions at 1.3340.
Because I’m trying get as much of the move up as I can, I don’t have a set profit target. Wish me luck!